There is nothing better than hands-on experience in providing articles to guide people through the potential downsides of buying property in Cyprus. I had purchased through a major developer and commissioned a bespoke home to be built. What I definitely didn’t do was start getting to know the ropes. I have to learn – but not the hard way !! That said property buyers often leave their brains at the airport – don’t let you!!
The first thing is to ensure that the property or piece of land is what you want to meet your living needs whether for vacation use or permanent residence in a new location. If you are buying to rent or for investment then you should also study the costs and possible returns well.
In addition, there will be laws and regulations that must be met and obeyed and taxes that must be paid both in your place of origin and in Cyprus.
When purchasing the plans I went to see other properties the developer had built and to speak to one or two owners. Then I scavenged through the plans of the place I wanted to buy and the overall progress at the developer’s office asking lots of questions to make sure I knew the layout of the house and garden. And I also looked at the standard finish of the samples in the office to make sure I didn’t have to pay extra for something half as decent.
It was only then, hours later, that I ventured out to the location and after fully understanding the plan, put the location into context including the house in relation to the other houses and the sun.
The next stage is returning to the office to negotiate a price including minor additions or modifications to the property. Discounts are always available if you ask but don’t expect to keep coming back days or weeks later to undercut the price. Ask to see the contract and ask the developer’s legal department to explain everything to you. Is there a penalty clause for later submissions? Can you cancel? Are there legal fees if you want to sell before the title deed is issued? Does the property have planning permits and building permits?
Then go and find yourself an independent local lawyer, who has no ties to the developer, and is registered with the Cyprus Bar. Discuss the cost of the legal purchase process and then ask your attorney to explain how the formal process works and how your interests will be protected during the period from when you pay the developer for the house until you get ownership and a title deed is finally issued to you and you pay Land Transfer Tax and Your Immovable Property Tax. Even if you may be an EU citizen, you will still need to obtain a permit to own property in Cyprus unless you are already registered as a permanent resident of Cyprus. Also ask your attorney to help set up a bank account, a power of attorney for him to act for you and the provision of water and electricity by direct debit. This saves a lot of time and rushing later when you can’t wait to move.
Not much about the money so far. How much will you pay as a non-refundable deposit? Credit Card or Cash?
But do you need a local mortgage to pay the rest? Do you need bank guarantee from your developer? How much does it cost? What currency to borrow? How long do you want the mortgage to be? Medical personnel? Life insurance? Income Proof? Passport copy? Lots of things to arrange before you fly home.
Stage payment. You don’t want to pay for anything, so make sure you appoint a RICS-qualified surveyor to inspect the construction as you go and before every payment you make. They can also ensure that you get a virtually hassle-free property so there is very little to cover by the final retention payments that are paid after ownership.
Or are you going to be raising funds for another property in the house? How long will it take and how does it fit into the staged payment schedule?
There is so much to remember and not all of it is written in this article. But often there is plenty of help and advice from others who have done it before you on the internet or in your local library at home.
Good Luck with buying property in Cyprus – your dream home – enjoy.